US Republicans face uphill battle on net neutrality bill

Congressional Democrats expressed a willingness to engage with Republicans on their proposed net neutrality legislation, but during a series of hearings on Wednesday, they expressed concerns that the bill would still leave loopholes and render the FCC unable to quickly act on complaints. “With an ever-evolving Internet, we need a regulator who is not frozen in time,” said Sen.A day after President Obama renewed his calls for a “free and open Internet” in Tuesday’s State of the Union Address, the new Republican-led Congress is set to open debate Wednesday for new legislation meant to preserve the controversial principle known as “net neutrality.” At issue is how the Internet should be regulated.The heads of leading cable TV and wireless industry trade groups on Wednesday expressed enthusiasm for Republican legislation setting new Internet traffic rules because it would avoid the legal battles they said were coming if the Federal Communications Commission enacts controversial new regulations to protect so-called net neutrality.

This week the center of gravity in the net neutrality debate shifts to Capitol Hill, where hearings in both chambers are pitting Democrats against Republicans over the future of the Internet. Should Internet providers like Comcast and Verizon be allowed to make “fast lanes” for content they want to prioritize, or should the government step in to ensure that providers treat all web content the same?

In a House hearing in the morning, the key players who have supported the telecom industry told lawmakers that they favor keeping the Internet free from interference by Internet service providers, but labeling ISPs as public utilities would impose difficult burdens on their business. But a “discussion draft” of a bill floated by Republicans in Congress last week suggests that they are adjusting their stance – though critics say the move could ultimately do more harm than good. Previously, many Republicans had called such net neutrality regulations “Obamacare for the Internet,” saying they were the invasion of big government onto the web (though such regulations had been in place from the Internet’s start). Now the FCC appears ready to put rules in place under a different section of the law that would treat broadband providers like regulated phone companies and other utilities. The liberal activist group Demand Progress calls it a “cynical ploy,” adding in an email that “in a town used to policy flip flops, this is a pirouette of Olympic caliber.” Today both houses of the new Republican Congress are holding hearings meant to lay the groundwork for a bipartisan network neutrality deal.

Under this approach, ISPs would be prohibited from any attempts to give prioritization of faster speeds to their affiliates or to third parties willing to pay them for faster Internet lanes for their video or content. FCC chairman Tom Wheeler has indicated that he is moving toward a proposal in which the FCC would reclassify the Internet as a Title II telecommunications service, a regulatory move designed to give the agency a more solid legal footing from which to impose Internet rules. But a coalition of tech companies including Amazon, Facebook, Google, Microsoft, and more than 100 others lobbied Congress in support of net neutrality. Republicans were left in the position of defending an industry that routinely ranks last in national consumer-satisfaction surveys. “By turning the FCC away from a heavy-handed and messy approach to regulating the Internet, this draft protects both consumers who rely on Internet services and innovators who create jobs,” said Sen. But they were concerned the bill wasn’t broad enough to allow the FCC to adapt to new threats to the free flow of online traffic. “How can we be sure that this bill anticipates every possible form of discrimination?” said Chad Dickerson, chief executive of Etsy, an online marketplace for handmade and vintage goods.

Network neutrality advocates worry that if ISPs start giving higher priority to content from big companies that pay them extra, startups and other small content providers could get squeezed out. In the past, Republican lawmakers have generally sided with large ISPs, such as Comcast, Verizon and Time Warner Cable, and said new rules aren’t needed because competition and consumer demand would dictate how their services are sold. An important sign of the bill’s fortunes will be whether Democrats on the two committees with jurisdiction — the Senate Commerce Committee and the House Energy & Commerce Committee — support the GOP proposal.

Broadband providers have warned that such a step risks burdening them with cumbersome regulation, stifling their investment in Internet upgrades, and some firms have already suggested that they would challenge the FCC in court. Paul Misener, Amazon’s vice president of global public policy, said the bill had some potential loopholes, such as an exemption for “specialized services,” that broadband providers could exploit to allow paid prioritization and other discriminatory behavior “The Internet is dynamic. But they’ve been caught off guard by the visceral and overwhelmingly pro-net neutrality consumer reaction among their constituents, who see the issue beyond the political lines.

Last May, Upton was describing network neutrality rules as a “solution in search of a problem.” Network neutrality supporters believe that in order to fully protect network neutrality, the FCC needs to declare broadband providers to be common carriers, an option known as reclassification. With the FCC seemingly ready to enact stringent rules that would adopt Title II, lawmakers proposed a new draft legislation late last week that, if passed, would replace the FCC as the guiding authority on net neutrality. Greg Walden (R-Ore.) called such an FCC action the “nuclear option.” The GOP bill also would prevent the FCC from taking actions based on a provision of the 1996 Telecommunications Act that charged the agency with promoting adoption of broadband services.

Greg Walden, R-Ore. — would ban ISPs from offering paid prioritization for faster lanes and prohibit any attempts by ISPs to block or deliberately slow content. Cory Booker (D-N.J.) told reporters Tuesday he was open to discussing alternatives with Republicans but that conservatives’ reactions so far to Obama’s plan have been “hilarious” and “unnecessary.” “I don’t see a pathway [to net neutrality] but through Title II,” said Booker, referring to a portion of the Communications Act that would give FCC broad authority to regulate Internet providers. It’s “just like proscribed ‘paid prioritization,’ the only difference being that the content or service prioritized came from the broadband Internet access service provider itself, instead of a third party.” In January 2014, the U.S. Michael Powell, president and CEO of the National Cable & Telecommunications Assn. and a former FCC chairman, expressed support, while Meredith Attwell Baker, president and CEO of The Wireless Assn., called the bill an “excellent start.” Rep.

That has alarmed large broadband providers and their allies in Congress, because it potentially opens the door to regulations that go far beyond network neutrality. John Shimkus (R-Ill.), who called himself a “paid prioritization” guy in favor of light regulation — said that he has come around to recognize that government action is a reality. Ryan Radia, a network neutrality skeptic at the libertarian Competitive Enterprise Institute, readily concedes that the GOP’s changing stance is “kind of a flip-flop,” but he says the shift is justified. Although we don’t know much about Pallone’s positions on telecom issues yet — some analysts have suggested he’s aligned more closely with industry — he signaled Wednesday that he’d resist efforts to undermine the FCC through the GOP legislation. For example, Bergmayer worries that ISPs might harm competition by charging consumers different rates for different types of content — for example, charging customers extra fees when they download content from Netflix rather than Hulu.

But under the Republican alternative, an aggrieved party would have to bring a complaint before the FCC, a process that could take years and might not provide protections to others harmed by the same ISP conduct. Van Schewick and her Stanford University co-author Morgan Weiland offer an even more scathing assessment of the Republican proposal, detailing seven different ways the bill falls short of full protection for an open internet. They note that the law includes several vague terms that could create loopholes for undermining network neutrality and gives the FCC limited authority to close these loopholes.

And that means Republicans have little leverage. “It’s definitely useful that Republicans are willing to go on the record with support for some version of network neutrality,” Bergmayer says.